Why Including Women In The Boardroom Is So Vital Right Now

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woman leader in the boardroom

There's so much conversation around diversity, especially in the workplace.

Several large companies now have human resource diversity and inclusion titles. There are forums trying hard to groom and gear women to take on more leadership roles.

Professional ecosystems are shaping up with several initiatives in the area of diversity. And, this passionate push for diversity is only about a decade old.

In the West, diversity primarily means anyone who is a non-white male. When people talk about diversity here in India, it's mostly about including more women in the workforce.

Although I do want to point out that with each state in India being like a country in itself — with its own language, culture, and cuisine — there is plenty of diversity. However, we don’t completely acknowledge it.

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There's a financial incentive for organizations to be inclusive of women leaders.

History has demonstrated that whenever there is any trend that starts gaining momentum or popularity, there's usually a financial gain behind it.

In 2016, a study of more than 21,000 public companies in 91 countries conducted by the Peterson Institute for International Economics in collaboration with professional services firm EY found that bringing more women into higher management roles boosted profitability.

It stated that a company with 30 percent female leadership could expect to add up to six percent, which points to its net margin in comparison with a similar business with no female leaders.

McKinsey published a similar study in greater detail.

Organizations are competitive for women and diversity like never before. 

They all give you proof of how it's profitable to have women in executive roles, but no one really tells you why now?

The best way to understand it is like this: With the globalization-cum-information era we are in, organizations are competitive like never before.

To stay ahead, they know there is one thing they cannot survive without: innovation.

Diversity leads to innovation.

Of course, several factors contribute to innovation. Simply put, when different ideas collide in an open, non-judgmental space of allowing, creation takes place, which leads to innovation.

To get diverse ideas, you need people that have had varied life experiences, have dissimilar values, and heterogeneous genetic makeup. You need to have the same things looked at from different perspectives.

It's just not possible to do that without diversity.

Usually, bright, intelligent people brimming with ideas also tend to be attached to their ideas, with their egos soaring high.

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Women leaders nurture new ideas and innovation.

Women in the board room and in leadership roles tend to encourage nurturing space for ideas to thrive.

They listen, collaborate, and are accessible. Of course, good leaders of any gender can facilitate this, but it’s just that women have had generations of practice at this.

Organizations with women leaders tend to be risk-averse and thrifty.

The flip side of innovation is that it requires an appetite for risk; you don’t know if a new idea will work or not.

According to research by Credit Suisse from 2012, companies with women on boards tend to be a little more risk-averse and have on average, less debt.

It has been seen that they also enabled reduced debt faster after the economic debacle of 2008.

It's never been more possible to be a woman leader in business.

Another reason is that now it's possible and a more tangible reality to have women leaders.

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From the agricultural revolution to the industrial revolution, the pre-requisites of achieving success were primarily physical strength.

History was not a leveled playing field for the majority of women.

As the world gradually moves towards automation of production, information, and communications technology, the internet and now the digital era, a leveled playing field for women has been formed.

Women have quietly been educated at par with men, often due to their sincerity and greater levels of focus.

As it often pans out, when it is not easily available, you tend to want it more. This has led to a talent pool primed and ready to be tapped into.

This is the understanding I find lacking in so many senior leaders I've come across.

Once the real reasons behind initiatives are understood, it becomes really easy to imbibe policies within organizations.

Personal biases then take a backseat. Hopefully, this clarity will enable more women leaders. Heck, it's also about time.

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Bhavna Dalal is a master certified executive coach MCC ICF, speaker, and author of "Checkmate Office Politics" who helps people develop their leadership skills, such as executive presence, strategic thinking, influencing, and networking. To learn more about her work, visit her website or follow her on LinkedIn.

This article was originally published at Forbes India. Reprinted with permission from the author.